TimingCrystal

[teabull]

The major stock market indices rallied nicely this week, as anticipation over the next Federal Reserve meeting on September 18, 2007 grew stronger.
My guess is that a 25 basis point cut in the Federal Funds rate is already priced into the stock market as of Friday's closing levels. Further, I would surmise that the equity markets are craving for a 50 basis point ease in the Fed Funds rate on Tuesday, coupled with an equally strong cut in the Discount Rate that the Federal Reserve charges other banks. Anything short of a 50 basis point cut in the Fed Funds rate will probably lead to at least a one day sell-off in the stock markets. Moreover, the accompanying statement that the Fed always issues will be scrutinized for any hint that the Central Bank is on alert to the possibility of further rate cuts should economic reports issued between the September 18, 2007 meeting and 6 weeks hence prove to be weak in the aggregate. The TC Index is suggesting that the next two week period should continue to be constructive for the equity markets. Although given this, the TC Index's value changes every day, and therefore it is better to be monitored on a daily basis for any significant change. The Economic Cycle Research Institute's latest reading is for a marked slowdown in the US economy over the coming months. However, they continue to dismiss a recession over the near-term horizon. If their analysis continues to be correct, this projection would be welcome news for those investors who are long the market over the medium term.

Sincerely,

Anthony Waller
President
Teabull Asset Timer Ltd
http://www.timingcrystal.com

Please note: The views of Anthony Waller and Teabull Asset Timer Ltd are not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. We always recommend that investors seek investment advice from their licensed investment Advisor or Broker before making any financial decisions.